The Future of DefenceMade in NSW

About Australia

2

The Australian economy has outperformed the country's peers for more than two decades. Now in its 27th

year of consecutive growth, Australia's economic resilience and strength are unsurpassed among major

advanced economies. The nation offers a smart, multicultural workforce with an enterprising mindset and

the skills to drive innovation and grow international business.

Australia prides itself on stable institutions and good governance, making it one of the safest places in

the world to do business. It boasts a globally integrated economy that plays a key role in shaping Asia's

dynamic economic future.

There is no better business partner than Australia.

Ranked No. 1 smartest country in the Asia Pacific and 4th smartest country in the world

27 years of uninterrupted economic growth

13th largest economy in the world

4th largest economy in the Asia–Pacific region

AAA credit rating Higher in credit quality than the US, UK, France, Japan, Hong Kong, Republic of Korea and New Zealand

2.9% economic growth, one of the highest industrial economic growth rates for developed countries globally

Front cover image courtesy of Department of Defence image library.

Australia

New South Wales (NSW)

Sydney

22

About Sydney and New South Wales

New South Wales (NSW), with

its iconic capital city of Sydney,

is Australia’s most populous

state and largest economy.

A cosmopolitan and regional

powerhouse, the state seamlessly

blends business strength, access

to Asia, and one of the world’s

most enviable lifestyles. Boasting

a AAA credit rating, NSW is

experiencing Australia’s largest

infrastructure boom and is home

to a highly skilled, innovative and

creative workforce.

ABOUT NSW:

Capital city: Sydney

NSW population:

7.9 million

Sydney population

5.1 million

NSW time zone:

GMT +10:00

Climate: Sub-tropical and

Mediterranean

Sydney summer temperature average:

18–27 °C

Sydney winter temperature average:

7–18 °C

Coastline: 2,007 kms

Official language:

English

Currency: Australian dollars

(AUD)

International airport:

Sydney Airport

South East and Tablelands

Illawarra-Shoalhaven

Greater Sydney

Central Coast

North Coast

Hunter

New England and North West

Central West and Orana

Far West

Riverina Murray

Port Macquarie

Tamworth

Lismore

Armidale

Newcastle

Gosford

Sydney

Dubbo

Broken Hill

Wollongong

Eden

Wagga Wagga Canberra(ACT)

Sydney is No. 1 in the Asia Pacific and No. 3 globally for top 100 ranked universities

Sydney is the highest-ranked capital city in Australia for quality of life

Home to 7.9 million people, more than Singapore and Hong Kong

Sydney is the 2nd highest ranked city in the Asia–Pacific region for innovation

NSW is home to three of Australia’s top five highest ranked research universities

NSW is set to deliver on the biggest infrastructure program in Australian history, with a A$87.2 billion pipeline of infrastructure

The state is Australia’s largest economy: A$500 billion, larger than Malaysia, Singapore and Hong Kong

NSW is the startup capital of Australia, home to more than 40% of all startups

NSW is Australia’s leading source of highly skilled and diverse talent

NSW is Australia’s most secure and liveable place to do business

NSW is Australia’s largest market

NSW is Australia’s most innovative state with a strong culture of

entrepreneurship

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Introduction

New South Wales (NSW) has the strongest defence1 presence and the most sophisticated defence-related industrial base and research institutions of any state in Australia.

NSW has been the leading

enabler of national defence since

before federation in 1901, and

has the greatest concentration

of defence assets in the country.

NSW’s position is enhanced

by being Australia’s economic,

financial and educational

powerhouse, contributing one-

third of the country’s gross

domestic product and enjoying

an AAA credit rating and record

business investment.

The defence industry in NSW

has core strengths and expertise

in the most critical capabilities.

These include advanced and

subsystem manufacturing,

sustainment of major systems,

complex project management,

complex systems integration,

cyber security, and composite

materials research, design

and production.

As a result, all the major

defence primes either have their

headquarters in NSW or have a

substantial presence in the state.

Today, NSW is also home to

the majority of Australia’s

leading tertiary research and

development institutions

with significant experience in

delivering on defence capability

priorities and attracting

international investment.

1 Department of Defence, the Australian Defence Force and related entities.4

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NSW attracts the highest annual defence investment across acquisition, sustainment and operations

Defence sector overview

NSW is home to more than one-quarter of Australia’s military and defence civilian personnel, with 25,000 people including permanent members, reservists and civilians.

The state hosts more than 80

facilities, including 21 major

defence bases and training

sites—more than any other

Australian state or territory.

The operational headquarters for

the Royal Australian Navy, the

Australian Army and the Royal

Australian Air Force, as well as

the Joint Operations Command,

are located in NSW. All three

services have their strategic

headquarters in the Australian

Capital Territory—the ACT.

Additionally, NSW hosts major

sustainment hubs for the Royal

Australian Navy at Garden Island

Defence Precinct, the Australian

Army at Holsworthy Barracks, and

the Royal Australian Air Force at

RAAF Base Williamtown.

Supporting the greatest

concentration of defence assets,

NSW is home to the largest

defence industrial workforce

(6,500 direct and more than

29,000 indirect workers).

NSW also attracts the highest

annual defence investment

across Australia in acquisition,

sustainment and operations

(valued at approximately

A$9 billion per annum).

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Major defence bases in NSW

RAAF Base Glenbrook

RAAF Base Richmond

Lone Pine Barracks (Hunter)

RAAF Base Williamtown (Hunter)

Sydney Harbour- HMAS Kuttabul- HMAS Penguin- HMAS Waterhen- HMAS Watson

Victoria Barracks

Randwick Barracks

Liverpool Military Area

HMAS Albatross (Illawarra-Shoalhaven)

HMAS Creswell (Illawarra-Shoalhaven)

RAAF Base Wagga (Riverina-Murray)

Blamey Barracks (Riverina-Murray)

Air Force

Army

Navy

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Sector capabilities and enablersNSW’s strong industrial base

underpins our defence capability

The defence sector is

underpinned by a deep and

complex industrial base with

capabilities in materials research,

industrial design, information and

communication technology, and

complex systems integration.

NSW offers these capabilities,

positioning it well to meet current

and future workforce skills needs.2

For example, the industrial

base for the defence sector in

NSW includes highly innovative,

competitive and world-leading

manufacturers that are using

state-of-the-art technology and

highly skilled staff.

These manufacturers are vital

to the diversity and strength of

the Australian economy. Overall,

manufacturers in NSW produce

almost 30% of the country’s total

output in the sector, generating

around A$30.18 billion annually

and accounting for one-third of

manufacturing jobs.3 4

2 Department of Industry NSW, 2017, New South Wales: Strong, smart and connected – The NSW Government Defence and Industry Strategy 2017, industry.nsw.gov.au/__data/assets/pdf_file/0011/98624/NSW-Strong-smart-and-connected-defence-strategy.pdf, accessed 8 June 2018.

3 Australian Bureau of Statistics, 2017, Australian National Accounts: State Accounts, 2016–17, cat no. 5220.0.

4 Australian Bureau of Statistics, 2018, Australian Industry 2015–16, cat no. 8155.0.

Sector supply chainNSW has strong capability across the defence sector value chain. The state's largest capacity is in support

services including ground operations; training; emergency response; maintenance, repair and operations

(MRO); project and data management; and engineering (including test and calibration).

Relative strengths of industry capability

Research & development, commercialisation, design

Product development, production/manufacturing

Engineering & research

Materials, composites, alloys

Construction & manufacturing

Vehicles, hardware equipment

Unmanned systems

Munitions, ordnance, explosives

Electronic systems, sensors, hardware

Propulsion systems

Command, control and communications

IT, cyber security

Sales and service

Training and safety

Transport and logistics

Support services

Sales, services/maintenance, logistics

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999

Image courtesy of Department of Defence image library.

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Critical industry capabilities

Industry capability is spread throughout NSW but is generally close to defence presence and infrastructure in Sydney, including Western Sydney, and several specific regions.

Capability Sydney

Hunter-

Newcastle Illawarra

Western

Sydney

Rest

of NSW

Support services ••• •• • • •

Engineering & research ••• •• •• • •

Construction & manufacturing ••• • • •• •

Training & safety •• • •• •

Transport & logistics •• •• • • •

Sales & service •• • • • •

Electronic systems, sensors, hardware

•• •• • • •

Command, control & communications

•• • • • •

IT, cyber security •• • •

Materials, composites, alloys • • • • •

Unmanned systems • • • •

Vehicles, hardware

equipment/platforms• • • • •

Munitions, ordnance, explosives • •

Propulsion • • •

Security, access control • •

Key: ••• Significant capability •• Developed capability • Some capability

Areas of Industry Capability in NSW

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Greater Sydney region

The Greater Sydney region—

incorporating Sydney Harbour,

Western Sydney and the Blue

Mountains—hosts a significant

number of Australian Defence

Force (ADF) bases, facilities

and personnel. This defence

presence is complemented

by the concentration of prime

contractors and specialist small

and medium-sized enterprises

(SMEs) working in both defence

and the wider industry.

Sydney hosts a number of industry

clusters that are vital to the

defence sector. These include

acoustic technologies and systems;

complex systems integration;

cyber security; advanced materials

and optics; helicopter and jet

engine maintenance; simulation;

intelligence, surveillance and

reconnaissance; electronic

warfare; space technologies; and

small arms manufacturing.5

One vital industry is the

sustainment of naval vessels.

Directly and indirectly, the naval

presence in Sydney contributes

around A$1.83 billion annually to

the economy and supports more

than 12,000 jobs.

The NSW Government is

developing an aerospace and

defence industry precinct at

the future Western Sydney

Airport. Northrop Grumman, a

leading global aerospace and

defence technology company,

has committed to being an

anchor tenant. The precinct will

position NSW to continue its role

as Australia’s leading state for

delivering complex defence systems.

The Western Sydney Aerotropolis

defence and aerospace precinct

offers the opportunity to

create leading capabilities in

industrial technology, including

complex systems design and

integration, logistical support

and cyber security.

5 Department of Industry NSW, 2017, New South Wales: Strong, smart and connected – The NSW Government Defence and Industry Strategy 2017, industry.nsw.gov.au/__data/assets/pdf_file/0011/98624/NSW-Strong-smart-and-connected-defence- strategy.pdf, accessed 8 June 2018.

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Regional NSW

The Hunter Region, including

Newcastle, Williamtown and

Singleton, hosts key Air Force

and Army establishments, such

as RAAF Base Williamtown,

Australia’s premier jet fighter

base. Key defence industry

capabilities include sustainment of

major aircraft platforms, advanced

electronics and infantry training,

and maritime sustainment.

The South Coast Region includes

the Shoalhaven and Illawarra. The

Shoalhaven is home to the Navy’s

Fleet Air Arm, and is renowned as

Australia’s centre for naval aviation.

Key defence industry capabilities

include design, manufacturing

and in-service support for

mechanical and electrical systems,

test regimes, and simulation and

training services.

The Illawarra has a sophisticated

innovation ecosystem that is at

the cutting edge of research and

industry collaboration.

Leading research and

development institutions include

the Defence Materials Technology

Centre and the Centre for

Computer and Information

Security Research.

Critical industry capabilitiesThe Murray–Riverina Region,

including Wagga Wagga, Albury

and Mulwala, plays host to

defence’s presence at RAAF

Base Wagga, and the Blamey

and Latchford barracks. The

region is also home to military

training and specialised contract

engineering, as well as propellant

and explosives manufacturing.

The North Coast Region,

including the towns of Yamba,

Port Macquarie and Taree, has

numerous defence industry

capabilities, including small-

vessel design and manufacturing;

maritime sustainment and

disposals; and the design,

manufacturing and support of

specialist defence products.

The Capital Region, including

Queanbeyan and Goulburn,

adjoins the ACT. The ACT is home

to the Australian Government

departments that formulate

policies on defence and security,

and make decisions on national

defence acquisitions and

sustainment. The ACT–NSW

Memorandum of Understanding

for Regional Collaboration

signed in 2016 underpins the

strengthening relationship

between the two jurisdictions.

NSW Defence and Industry

Strategy

The state government launched

the NSW Defence and Industry

Strategy, NSW: Strong, smart

and connected, to support

defence industry development,

and increase investment and

innovation in NSW. The whole

of NSW government strategy

prioritises the defence sector as a

key driver of growth, especially in

regional NSW, and aims to further

cement NSW as the heart of

Australia’s defence sector.

The strategy is built around five

key themes: building stronger

relationships; leveraging critical

strengths; growing the future

workforce; sustaining regional

industry; and driving research

and innovation.

The NSW Department of

Industry formed a dedicated

team, Defence NSW, to execute

the strategy by creating the

conditions for sustainable,

technologically advanced and

globally competitive defence

industries across the state.

Defence NSW provides whole

of NSW government leadership,

advocacy and engagement with

the defence sector.

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Defence research organisations

focus on enhancing capabilities

NSW has well developed R&D

capability across the defence

sector including significant

capability across the nine defence

priority technologies. There

has been significant investment

in centres of excellence,

infrastructure and training in NSW.

NSW universities receive 30%

(A$3.2 billion) of national

university R&D expenditure,

and 18% (A$16 million) of

national university defence R&D

expenditure.

The presence of NSW capability

across the entire value chain

coupled with strong R&D

capability makes NSW an ideal

'test bed' for innovation. Primes

have the opportunity to partner

with NSW universities on R&D

projects and then work with NSW

companies to test, commercialise

and build a supply chain prior to

global roll out.

The NSW Defence

Innovation Network

The NSW Defence Innovation

Network (DIN) was launched

in 2017 to strengthen research

and development in defence

priority areas such as quantum

technologies, trusted autonomous

systems and cyber security.

This state-sponsored partnership

between the Defence Science

and Technology Group

(DSTG) and seven world-

class universities is enhancing

collaboration with industry to

enable faster development and

commercialisation of technologies.

The network’s founding

universities are:

• Macquarie University (MQ)

• University of New South

Wales (UNSW)

• University of Newcastle (UoN)

• University of Sydney (USYD)

• University of Technology

Sydney (UTS)

• University of Wollongong

(UoW)

• Western Sydney University

(WSU).

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Summary of relative R&D strengths across the Defence Innovation Network

Defence Priority Technologies M

acq

uari

e U

ni.

(MQ

)

Un

i. O

f N

SW

(U

NS

W)

Un

i. O

f N

ew

cast

le

(Uo

N)

Un

i. O

f S

yd

ney

(US

YD

)

Un

i. O

f Te

ch

. Syd

ney

(UT

S)

Un

i. O

f W

ollo

ng

on

g

(Uo

W)

We

ste

rn S

yd

ney U

ni.

(WS

U)

Advanced sensors and intelligence

•• ••• •• ••• •• •• ••

Autonomous systems • ••• •• ••• ••• •• ••

Communications, electronics and digital technology

•• ••• • ••• •• • •

Cyber and IT security •• ••• •• ••• ••• •• •

Enhanced human performance and protection

•• ••• • ••• ••• •• ••

Hypersonics ••• ••

Material sciences and manufacturing

• ••• • ••• •• ••• ••

Quantum technologies •• ••• ••• •• •

Space technologies •• ••• • ••• ••

Capability: • Some •• Developed ••• Highly developed

Table excludes Australian Catholic University, Southern Cross University and University of New England as defence relevant capability was assessed as limited. Assessed with reference to ERA Report 2015, ARC Grants Database, State of Research in Australian Universities Report (Barlow, 2015), League of Scholars Research Database, NSW Defence Innovation Network capability database, NSW Cyber Security Network capability map, NSW Smart Sensing Network capability database, independent research.

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NSW also boasts numerous

leading defence industry–related

research institutions, including:

• The Centre for Quantum

Computation and

Communication Technology

at UNSW, which is making

one of the largest combined

and focused efforts in

quantum computation and

communication in the world6

• The Centre for Autonomous

Systems at UTS, an

internationally acclaimed

robots research group7

• The SMART Infrastructure

Facility at UoW, an

international leader in applied

infrastructure research8

• The Steel Research Hub at

UoW, which is providing

innovative solutions and

breakthrough technologies in

the steel industry.9

Commonwealth policy

and strategies

The Australian Government’s

2016 Defence White Paper

outlines programs and

acquisitions worth more

than A$200 billion over the

next decade. The Australian

Government has since developed

federal policy and plans that align

with the national approach to

defence challenges adopted in

the NSW Defence and Industry

Strategy, NSW: Strong, smart

and connected. These include an

integrated investment program,

defence industrial capability plan,

naval shipbuilding plan and a

defence export strategy.10

6 Centre for Quantum Computation and Communication Technology, 2018, cqc2t.org/research

7 University of Technology Sydney Centre for Autonomous Systems, 2018, uts.edu.au/research-and-teaching/our-research/centre-autonomous-systems

8 University of Wollongong Australia, 2018, smart.uow.edu.au

9 Steel Research Hub, 2018, steelresearchhub.uow.edu.au

10 Department of Industry NSW, 2017, New South Wales: Strong, smart and connected – The NSW Government Defence and Industry Strategy 2017, industry.nsw.gov.au/__data/assets/pdf_file/0011/98624/NSW-Strong-smart-and-connected-defence-strategy.pdf, accessed 8 June 2018.

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Case study: Thales and Raytheon The world-leading underwater systems

facility at Rydalmere in Western Sydney is an

example of the outstanding complex systems

development and sustainment capabilities

available in NSW. The recent selection of

Thales Australia, in partnership with combat

system integrator Raytheon Australia, to

deliver new sonar systems to the Navy’s

current fleet of submarines is a testament to

this capability. It also highlights the depth of

the extensive defence industry ecosystem

of smaller supporting companies, such as

Sonartech Atlas in Macquarie Park, and the

potential for continued development of

sovereign sonar capability for our new Hunter

Class frigates and Attack Class submarines.

Case study: Australian Munitions Thales also owns Australian Munitions,

the only manufacturer of explosives,

propellants and concentrated acid

products for defence applications in

Australia. The Mulwala Propellant Facility

in regional NSW manufactures high-

quality propellants and explosives that

perform at consistent velocities over

an extended temperature range—a fine

example of sovereign defence industry

capability. Australian Munitions is the

largest supplier of explosive ordnance to

the ADF and has world-class propellant

research and development capabilities.11

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11 Department of Industry NSW, 2017, New South Wales: Strong, smart and connected – The NSW Government Defence and Industry Strategy 2017, industry.nsw.gov.au/__data/assets/pdf_file/0011/98624/NSW-Strong-smart-and-connected-defence-strategy.pdf, accessed 8 June 2018.

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Image courtesy of Department of Defence image library.

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Case study: BAE Systems Australia

The Joint Strike Fighter program

will meet the country’s air combat

needs beyond 2040. Under the

program, Australia will acquire 72

Lockheed Martin F-35 Lightning

aircraft. It will also deliver facilities,

weapons and new support

systems to meet fifth-generation

requirements.

BAE Systems Australia in

Williamtown will deliver the

sustainment facilities and servicing

to maintain, repair, overhaul and

upgrade the aircraft.12

The workforce is being

transitioned to have the high-

technology skills needed to

operate and sustain the fleet as

part of a global network and to

create a regional sustainment

hub for the Asia Pacific.13

Former Prime Minister Malcolm

Turnbull described the program

as ‘an example of how our

Defence Industry Plan is not

simply securing our Air Force

and our Army and our Navy

with the capabilities they

need to keep us safe in the 21st

century, but it is driving the

advanced manufacturing,

the jobs, the advanced

technology that Australians

need to make sure our children

and grandchildren have the

great opportunities in the

years ahead’.

12 Australian Financial Review, 2017, “Australia wins huge maintenance program to support F-35 aircraft”, afr.com/news/special-reports/defence-and-national-security/huge-maintenance-program-to-be-put-in-place-to-support-f35-20170303-guq4u3

13 Department of Defence, 2018, Joint Strike Fighter Division, defence.gov.au/casg/aboutcasg/ourstructure/air/jointstrikefighterdivision

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Case study: Bisalloy Steels

Unanderra-based specialist steel

finishing company Bisalloy Steels

has won a contract to work on the

add-on armour range for armoured

fighting vehicles being built by Rafael

Advanced Defense Systems.

The deal is evidence of NSW’s

sovereign defence industry capabilities

in military-grade armour steel

production. It also shows that SMEs

in regional Australia can successfully

compete for and win global supply

chain contracts with big defence

companies.

Welcoming the contract, former

Minister for Defence Industry

Christopher Pyne said: ‘This contract

demonstrates Australian defence

industry’s world-class capabilities,

creating and securing jobs and

opportunity in regional areas as well

as urban ones.’

2020

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How we can help

The NSW Government’s Industry,

Trade and Investment Team can

help you establish, innovate and

grow your business in Sydney and

NSW. Our dedicated team works

with experts across all levels of

government (local, state and

federal) and business networks to

provide customised information

for businesses. This service is free

and confidential.

The NSW Government is here to help you. If you need assistance, or have any questions, please contact NSW Government’s Industry, Trade and Investment team.

NSW Department of Industry, Trade & Investment Team:

T: +61 2 8222 4888

W: invest.nsw.gov.au

Contact us

We can provide:

• market intelligence and investment

opportunities

• support for business case development

• identification of suitable investment locations

and partners in NSW

• facilitation of familiarisation visits to NSW

• advice on NSW government programs and

approval processes

• connections with government contacts

including the Defence NSW Team and the

local business network.

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Image courtesy of Department of Defence image library.

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T:

© State of New South Wales through Department of Industry 2019.

+61 2 8222 4888

W: invest.nsw.gov.au

TheFutureMadeHere

The information contained in this publication is based on knowledge and

understanding at the time of writing (February 2019). However, because of

advances in knowledge, users are reminded of the need to ensure that the

information upon which they rely is up to date and to check the currency of

the information with the appropriate officer of the Department of Industry

or the user’s independent adviser.

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